Georgia residents who want to leave part of their estate to their favorite charities may consider using a charitable trust. One of the many advantages of doing so is that it can provide tax benefits for the donors. As the name implies, charitable trusts are created for a charitable purpose. According to Uniform Trust Code Section 405, the charitable purpose may be related to the propagation of religion or education, relieving poverty, encouraging health, fulfilling municipal or governmental purposes or any task geared toward benefiting the community.
People who are considering using a charitable trust should be aware of some of the main differences between that and a non-charitable trust. One main distinction is that charitable trusts do not need to have a clearly defined beneficiary. The beneficiary can be an unspecified entity, such as the general public, who will receive the economic and social benefits the trust will provide.
Another difference with charitable trusts is that they can virtually last forever, resulting in the trust not being affected by the Rule Against Perpetuities, which is used to prevent estate planning that limits the use of a property for an excessive amount of time. Lawmakers created a concession for charitable trusts because public policy addresses the issue of determining if perpetual charitable purposes are allowable differently. Charitable trusts are also governed by the Cy Pres doctrine, which allows trusts to be changed so that they can continue to exists and not fail in their purpose. An attorney who practices estate planning law may advise clients about the different types of trust instruments and which one may be most appropriate for their goals.
